United Kingdom Inflation

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United Kingdom: Inflation eases to a new record low in February

March 24, 2015

In February, consumer prices rose 0.3% over the previous month, which contrasted the 0.9% drop seen in the previous month and marked the fastest increase in six months. February’s figure was mainly driven by rising prices for alcohol and tobacco as well as for clothing and footwear.

Annual inflation recorded a flat figure in February, which was down from the 0.3% recorded in January and marked the lowest print on record. February’s reading came in slightly below market expectations of inflation falling to 0.1%. Annual average inflation inched down from January’s 1.3% to 1.2% in February, and now stands at its lowest level since October 2002.

In its latest inflation report from November, the Bank of England projected that inflation would average 1.2% in 2015. FocusEconomics Consensus Forecast panelists expect inflation to average 1.6% in 2015, which is down 0.1 percentage points from last month’s forecast. For 2016, the panel forecasts that inflation will average 1.8%.

Author:, Senior Economist

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United Kingdom Inflation Chart

United Kingdom Inflation February 2015

Note: Annual and monthly variation of consumer price index in %.
Source: Office for National Statistics (ONS) and FocusEconomics calculations.

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